On the sidelines of the G20 summit MTN CEO Ralph Mupita suggested that Nigeria has become a ”success story” for the group’s shareholders. Soon, it could become a nightmare scenario.
Over the past few weeks President Donald Trump has criticised the government of Nigeria over attacks on Christians and the government of South Africa over the G20 summit. These developments increase the risks for MTN Group shareholders, US multinational partners such as BNY Mellon and Microsoft and Nigerian officials.
Before those comments the South African telecoms company was already defending itself against multiple allegations of high-level government corruption and aiding and abetting of international terrorism.
Over the summer those cases prompted the Trump administration to initiate a grand jury investigation through the US department of justice. They also led House Republican leadership chair Elise Stefanik to demand that BNY Mellon re-evaluate the access it provides to MTN equities via US traded American depository receipts (ADRs).
The problem for MTN shareholders and Nigerian officials is that those legal disputes involve more than allegations of material support for the adversaries of the US government, including foreign terrorist organisations and specially designated global terrorists (the Islamic Revolutionary Guard Corps, for example). They also involve lucrative ties with a US law firm that has been targeted by the Trump administration in the past, Covington & Burling.
Those ties carry direct links with former attorney-general Eric Holder, who famously secured an eye-watering reduction in a multibillion-dollar fine imposed on MTN over unregistered SIM cards in Nigeria. They also carry indirect links to former Federal Election Commission chair Robert Lenhard, who led the firm’s work as campaign counsel for the Biden presidential campaign and the super political action committee supporting the Obama presidential campaign.
The relationship between MTN and Covington & Burling has long carried serious risks for MTN shareholders and US multinational partners. Since the second inauguration the Trump administration has demonstrated a commitment to not only imposing severe consequences on the South African government for undermining US national security and foreign policy interests. It has shown a similar commitment to imposing severe consequences on US law firms that supported US government investigations into Trump.
That makes MTN an interesting case. It provides an opportunity for the Trump administration to simultaneously pursue both of those desired outcomes. Senior South African government and ANC officials, including President Cyril Ramaphosa and special envoy to the US Mcebisi Jonas, have strong ties to MTN, while Covington & Burling has strong ties to the investigation into Trump by US special counsel Jack Smith.
The criticisms of Nigeria and South Africa should therefore deeply concern MTN shareholders, US multinational partners and Nigerian officials. The Trump administration and Maga movement would extract domestic political benefits from any US government investigation into whether MTN has ever sought to erode electoral integrity or other democratic institutions of Nigeria and/or the US.
That provides a strong motivation for the White House to press for the US government to conduct targeted investigations into whether MTN ever paid bribes in Nigeria and whether MTN and/or Covington & Burling staff ever conducted illegal lobbying activities and/or campaign donations that benefited the ANC, South African government or MTN interests. To be clear, neither would require an expansion in the scope of the ongoing grand jury investigation.
For example, the US government could easily investigate whether MTN paid bribes in Nigeria as part of US sanctions investigations pursuant to the Global Magnitsky Act and/or other US statutes. That includes the Nigeria-specific US sanctions investigations that were recently floated by the Trump administration as a coercive response to the “Christian genocide”.
Walsh is a non-resident senior fellow of the Africa programme at the Foreign Policy Research Institute and an affiliated researcher at the Georgetown School of Foreign Service.
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